RIGHT ON! While the NBA will appeal a ruling giving Jeremy Lin early-Bird rights, it looks like the Knicks will have a clear path to negotiate with the point guard. Photo: Anthony J. Causi

The union won and so did the Knicks.

In a bonanza to their free-agent summer, Jeremy Lin and Steve Novak have been granted their “early-Bird rights” by an arbitrator, giving the Knicks more financial flexibility this summer, allowing them use of their mid-level exception on a free agent.

Arbitrator Kenneth Damm’s ruling in the case against the NBA means Lin will be able to re-sign with the Knicks with the Bird exception. Novak was also granted early-Bird rights, giving the Knicks the clear edge in re-signing him, too. Without a union victory, Novak was as good as gone.

Nevertheless, within an hour of yesterday’s ruling, the NBA issued a statement saying it will appeal. If that spills over past July 1 free agency, it could create a delay in the Novak/Lin negotiations.

Union attorney Ron Klempner said he believes the appeal will be resolved by then. Asked if Lin and Novak will have Bird rights by July 1, Klempner said: “Yes.’’

“Can’t tell you how great it is to have my Bird rights preserved,’’ Novak tweeted. “A lot of hard work was put in to making it happen.’’

By not having to waste their $5 million mid-level exception on Lin, the Knicks can use it to lure a veteran point guard of stature. The Knicks, however, may decide to spend $3 million of the $5 million exception to keep them away from hitting the $74 million cap number, an important threshold to avoid.

Steve Nash leads the cast of point guard candidates but he’s a long shot, especially at $3 million. Nash said earlier this week he would listen to a Knicks offer, but a Nash confidant said he doubts he would consider the Knicks for less money because he feels they are not close enough to a championship and wasn’t happy with the team’s treatment of Mike D’Antoni, Nash’s former coach in Phoenix.

But there are point guards the Knicks may be in the market for even at $3 million — including Jason Kidd, Jameer Nelson, Andre Miller, Ramon Sessions, Raymond Felton, Louis Williams. Also, shooting guard Ray Allen is a free agent and has some interest.

Lin is a restricted free agent, so the Knicks can match any offer sheet for him. With the union win, Lin’s early-Bird rights contract with the Knicks can be longer and more lucrative. Lin now can sign a four-year Knicks deal at $24.5 million. The Bird-rights starting salary would be $5.5 million, according to a source, with 7.5 percent raises each season.

No other team can offer Lin more than the $5 million mid-level in the first two years under the Gilbert Arenas Rule. Nevertheless, there is a scenario where the Knicks could get “punked’’ by another club in a back-loaded deal that would be the third-year poison pill. A club under the cap could offer Lin a three-year deal with the third year at the maximum — $15 million. The Knicks still can match the offer, but they would put themselves in a luxury-tax nightmare.

Toronto and Phoenix are the two teams most likely to execute that sort of offer sheet. The Raptors also have interest.

The victory was not unexpected after arbitrator Damm heard the case 10 days ago. The Post reported a source saying the union had a “50-50’’ shot despite commissioner David Stern’s boasts.

“We only brought this proceeding because we felt this would be the right result,’’ Klempner told The Post. “We’re really pleased. This was the spirit of the rule.’’

The union argued players claimed on waivers should keep their Bird rights just as players who are traded. The battle hinged on the word “trade’’ in the 2005 CBA agreement. In the 1995 agreement, players claimed kept their Bird rights, but the 2005 language was fuzzier

The union’s winning argument, according to the decision, was if the NBA intended to have claimed players lose its Bird rights, it would have used language to specify it.